Calcutta High Court (Appellete Side)
M/S. G. P. Poddar & Brothers & Anr vs State Of West Bengal & Ors on 6 April, 2016
Author: Subrata Talukdar
Bench: Subrata Talukdar
IN THE HIGH COURT AT CALCUTTA
CONSTITUTIONAL WRIT JURISDICTION
APPELLATE SIDE
PRESENT:
The Hon'ble Mr. Justice Subrata Talukdar
W.P. 12111(W) of 2007
M/s. G. P. Poddar & Brothers & Anr.
-vs.-
State of West Bengal & Ors.
For the Petitioners : Mr. Sagar Bandyopadhyay
Mr. Phiroze Edulji
Ms. Alotriya Mukherjee
For the Respondent
Nos. 7 & 8 : Ms. Vineeta Meharia
Mr. Amit Kumar Nag
For the Respondent
No.9 : Mr. Ram Anand Agarwala
Mr. Ramesh Dhara
Mr. A. G. Mukherjee
For the State : Mr. Sushovan Sengupta
Mr. Sirsanya Bandyopadhyay
Heard on : 14/12/2015
Judgement on : 06/04/2016
Subrata Talukdar, J.: This writ application is directed against the impugned order being Memo No. 640/1(3)/DC/FS/PRL dated 18th April, 2007 issued by the District Controller, Food & Supplies, Purulia (for short the DC), being the respondent no.5, reducing the monthly allocation of Superior Kerosene Oil (for short SKO) in favour of the petitioner no.1 from 240 Kiloliters to 120 Kiloliters (for short KL), w.e.f. 8th of May 2007.
Sri Sagar Bandyopadhaya, Ld. Counsel appearing for the petitioners at the very outset takes this Court to the law on the issue as settled by an Hon'ble Division Bench of this Court by judgment dated 22nd December, 2006 in Jharna Sarkar & Anr. vs. State of West Bengal & Ors along with Hemlata Khatri vs. State of West Bengal & Ors. as reported in 2007 (1) CHN 514.
Sri Bandyopadhaya argues that the Hon'ble Division Bench was pleased to, inter alia, hold that SKO is a subsidized item allocated by the Central Government to different oil companies. Such allocation is thereafter distributed Statewise through oil companies in terms of the allocation chart as issued by the Central Government. Pursuant to such allocation the State Governments, including the State of West Bengal, are supplied with SKO for distribution through the Public Distribution System (for short PDS).
The Hon'ble Division Bench further went on to hold that the State Government distributes the SKO to ration card holders in terms of the West Bengal Kerosene Control Order, 1968 (for short the 1968 Control Order) in terms of the powers conferred under the Essential Commodities Act. Under the 1968 Control Order any agent or dealer is required to obtain the licence for supplying the SKO. Therefore, the proper authority is the State Government which has the powers to issue the licence and, also has the powers to cancel or suspend a licence. No distributor, such as the petitioner no.1, is entitled to carry on trade in SKO without a licence from the State under the 1968 Control Order. Derivatively the oil company, in this case, the respondent-Indian Oil Corporation Ltd. (for short IOCL) is bound to follow the provisions contained in the 1968 Control Order.
Sri Bandyopadhaya submits that the Hon'ble Division Bench therefore did not find any substance in the plea of the oil company, also the IOCL in the facts of In Re: Jharna Sarkar (supra), that the allocation of SKO is not bound by the 1968 Control Order and, is independently controlled by IOCL. The Hon'ble Division Bench further found that IOCL is under a lawful duty to supply the exact quantity of SKO required by an agent such as the petitioner no.1, for distribution through the PDS to the tagged ration card holders. In short, Sri Bandyopadhaya points out that the allocation of SKO lies exclusively within the powers of the State.
Taking this Court to the facts of the present case, Sri Bandyopadhaya submits that following the law laid down by the Hon'ble Division Bench In Re: Jharna Sarkar (supra), the order impugned of the DC dated 18th April, 2007 reducing the allocation of SKO is ex facie bad in law since such reduction in allocation seeks to follow a policy guideline of the Central Government vide its Ministry of Petroleum and Natural Gas. The purported policy of the Central Government which was framed in the year 1990 seeks to limit the allocation of SKO to 250 KL per agent per agreement irrespective of the number of storage points through which SKO is being supplied by the agent. Sri Bandyopadhaya points out that in the case of the petitioner no.1, SKO is being supplied through two depots - one at Purulia within the State of West Bengal and, the other at Chas within the State of Jharkhand - under a single agreement. The DC allocated in favour of the petitioner no.1, 120 KL in respect of the storage point at Purulia and, the balance quantity out of the total expected allocation was allocated to the private respondent no.9 in the writ petition.
In support of his submissions Sri Bandyopadhaya relies upon the order of an Hon'ble Single Bench dated 5th July, 2007 in respect of a connected application being CAN 4685 of 2007 in this writ petition. The order of the Hon'ble Single Bench dated 5th of July, 2007 (supra) has attained finality since none of the parties to the writ petition challenged the same. For the purpose of complete adjudication of this writ petition having regard to the important observations made in the order dated 5th July, 2007, the same requires to be set out in extenso:-
"This is an application filed by the added respondents for vacating the interim order dated May 25, 2007 passed in the main writ application.
The interim order was passed in terms of prayer 'f' of the writ application which is quoted below:-
By virtue of the aforesaid interim order the respondent authorities were directed to ensure supply of 240 kilolitres of kerosene oil per month in favour of the petitioners without prejudice to the rights and contentions of the respective parties till June 8, 2007. The above interim order was extended subsequently from time to time.
The applicant is one of the agents in the District of Purulia. By virtue of an order dated April 13, 2007 passed by the respondent No. 5, the quota supply of S.K. Oil to the petitioners was reduced from 240 kilolitres per month to 120 kilolitres per month on the ground that by virtue of one agreement the petitioner are running agencies from two distribution points, (I) Purulia a district in the state of West Bengal (ii) Chas a district in the state of Jharkhand. So in order to maintain the maximum quote of 250 kilolitres per month in respect of the agency of the petitioners about ½ of the total quota was proposed to be allotted in respect of its distribution point lying and situated in the District of Purulia, West Bengal. Pursuant thereto the allotment of S.K. Oil of the petitioner was reduced to 120 kilolitres as per order dated April 19, 2007 passed by the respondent No. 5. The added respondent lifted the allotment of S.K. Oil in terms of the aforesaid order passed by the respondent No. 5 in the month of May 2007.
The writ petitioners moved this writ application on May 25, 2007 and obtain the interim as quoted hereinabove. Thereafter the allotment of monthly quota of S.K. Oil that the writ petitioners were restored back to 240 kilolitres in the month of June 2007.
In the application for vacating the interim order it has been pleaded that the monthly quota of allotment of S.K. Oil of the added respondent was increased consequent upon the impugned order dated April 19, 2007 but due to the interim order dated May 25, 2007 passed in this writ application without making the added respondent as party to this proceedings, his monthly quota of allotment was further reduced.
Having heard the learned Counsel appearing on behalf of the respective parties and after considering the materials on record, the interim order dated May 25, 2007 is modified directing the respondents No. 4 to pass necessary order for fixing the monthly quota of allotment of S.K. Oil in respect of the agencies in the district of Purulia, West Bengal including that of the petitioner and the added respondent in accordance with law taking into consideration the monthly allotment of total quantum of S.K. Oil in respect of the district of Purulia, the number of dealers tagged on to be tagged with the respective agency as also the interest of the consumers at large from the month of July onwards till the disposal of the writ application."
Sri Bandyopadhaya also draws the attention of this Court to the fact that by the order dated 5th July, 2007 (supra) the Hon'ble Single Bench clearly specified that the SKO would be allotted keeping in mind the dealers tagged with the supply agencies, such as the petitioner no.1, in the interest of the consumers. It is also relevant to note, according to Sri Bandyopadhaya, that the order dated 5th July, 2007 was issued without taking into consideration the monthly quota of allocation of SKO to the petitioner no.1 in respect of its supply point at Chas in the State of Jharkhand.
Taking this Court to the several documents which have been made part of the Paper Book prepared in terms of the order of this Court dated 11th August, 2015, Sri Bandyopadhaya submits that by order dated 12th February, 2008 vide Memo No. 167/C the District Magistrate (for short DM), Purulia wrote to the Director of Consumer Goods, Food & Supplies Department (for short DCG) not to give effect to the revised curtailment in allocation in favour of the petitioner in view of the order of the Hon'ble Single Bench dated 5th July, 2007 (supra).
Following the Memo of the DM dated 12th February, 2008 (supra), the DCG on the very next date, i.e. 13th February, 2008 wrote to IOCL not to give effect to the Memo of the DCG also dated 12th February, 2008 revising the allocation of SKO to the petitioner no.1 and other agents named.
Sri Bandyopadhaya further argues that following the order of the DM dated 12th February, 2008 to refix the monthly allocation of all points in the District of Purulia effective July, 2007 without taking notice of the allotment of the petitioner no.1 in respect of the distribution point at Chas in the State of Jharkhand, the monthly allocation of the petitioner no.1 was restored to 240 KL and, in respect of the added respondent, such allocation was fixed at 160 KL. Sri Bandyopadhaya points out that the above noted position of supplies is continuing.
Sri Bandyopadhaya makes the additional point that due to the pendency of the present writ application there was a proposal by the oil company to segregate the distribution points of the petitioner no.1 upon executing separate agreements. Such process of bifurcation and execution of separate agreements is now being acted upon and, for all practical purposes the distribution points of SKO in each of the States is independent of each other.
Furthermore, with the Amendment of the 1968 Control Order vide Notification No. 3575-FS dated 25th of November, 2003 (for short the 2003 Amendment) and again, by the further Amendment to the 1968 Control Order in November, 2014 it is the competent State Authority which is entrusted with the responsibility to fix the allocation on the basis of ration card holders tagged to each of the distribution points of the dealers. Therefore, Sri Bandyopadhaya argues that the thrust of the facts and the law as submitted above is that the purported policy of the Central Government as expressed through its communication from the Oil Coordination Committee to State level coordinators dated 10th January, 1990 is no longer a valid policy and, having regard to the law settled In Re: Jharna Sarkar (supra) which has been accepted and acted upon by the oil company, it is the State which fixes the allocation of SKO in terms of the 1968 Control Order (as amended till date).
Relying on the authority laid down by the Hon'ble Apex Court in 1980 (Supp.) SCC 559 In Re: Col. A.S. Sangwan vs. Union of India & Ors., Sri Bandyopadhaya makes the point that the policy guidelines of the State Authority acting in the administrative domain need not remain fixed and, can evolve to meet the changing requirements. Accordingly, it is for the State-respondents to fix the allocation of the petitioner as an agent in respect of the Purulia distribution point without bothering itself about the distribution point in a separate State, which is under a separate State Regulatory Authority.
Arguing on behalf of the respondent nos.7 and 8-IOCL, Ms. Vineeta Meharia, Ld. Counsel takes the short point that it is for the State-respondents to justify the decision to reduce the monthly allocation of SKO qua the petitioners in respect of the distribution point at Purulia and such onus has been recognized by the Hon'ble Division Bench In Re: Jharna Sarkar (supra). Therefore, Ms. Meharia concludes that the State-respondents are lawfully entitled to fix allocation of SKO by tagging and detagging ration card holders of SKO agents through their dealers/retailers and, in support of such submission, Ms. Meharia relies upon the provisions of Section 3(h) of the 2003 Amendment to the 1968 Control Order.
On behalf of the State-respondents Sri Sushovan Sengupta, Ld. Senior Government Adocate submits that the allocation of SKO is required to be guided in terms of the number of agreements irrespective of the fact whether there are one or more storage points. Taking this Court to the affidavit-in-opposition filed on behalf of the State-respondents, Sri Sengupta argues that the ceiling limit for distribution of SKO was fixed by the policy of the Central Government vide the communication dated 10th January, 1990. Pursuant to the policy of the Central Government and, in compliance with the order of an Hon'ble Single Bench of this Court the DCG held a meeting of all oil companies and agents, wherein a policy decision was taken on 2nd May, 2002 by which it was decided that no agent shall receive more than 250 KL SKO per month.
Further taking this Court to the affidavit-in-opposition of the State-respondents, Sri Sengupta submits that the IOCL was requested to revise the allocation of SKO in favour of the petitioner no.1 connected to the Chas storage point. Such revision of allocation to the Chas storage point in Jharkhand was fixed at 180 KL per month and the balance 70 KL was allotted to the storage point at Purulia out of the total ceiling allotment of 250 KL. Therefore, Sri Sengupta argues that the claim of the petitioners in this writ petition is beyond the ceiling limit.
Also arguing that the State has the jurisdiction to examine the number of dealers tagged with the writ petitioner no.1-agent, Sri Sengupta points out that allocation can be reduced with the reduction in the number of ration cards. Such survey of the ration cards tagged with the agent through the dealer can take place even if two agreements are separately entered into between the petitioner no.1 and IOCL.
The final point made by Sri Sengupta is to the effect that with the implementation of the National Food Security Act (for short NFSA), there is bound to be a reduction in the allocation.
Sri Ram Anand Agarwala, Ld. Counsel appearing for the private respondent no.9 relies on page 131 of the Paper Book and submits that the private respondent no.9 is presently in charge of the pilot project of IOCL for distribution of SKO in Purulia. Relying on the decision of the Hon'ble Division Bench reported in 2004 (2) CHN 606 in the matter of Indian Oil Corporation Ltd. & Anr. vs. Jharna Sarkar & Ors. , Sri Agarwala argues that it has been settled right up to the Hon'ble Apex Court that the allocation of SKO shall be 250 KL per agreement and not per storage point. Therefore, Sri Agarwala points out that the two storage points in the two States serviced by the petitioner no.1 stand covered by a single agreement with a maximum allocation of 250 KL.
Sri Agarwala points out that the order of allocation by the DCG dated 12th February, 2008 at page 121 of the Paper Book has been merely kept in abeyance in view of the interim order passed by an Hon'ble Single Bench dated 5th July, 2007. Sri Agarwala emphasises the point that the revised allocation dated 12th February, 2008 of the DCG (supra) is not under challenge. Therefore, Sri Agarwala submits that in the event at the stage of final disposal of this writ petition, this Court is not willing to accept the interim order dated 5th July, 2007, then the revised allocation order dated 12th February, 2008 of the DCG revives.
The final point taken by Sri Agarwala is in respect of the prayers in the writ petition. Sri Agarwala submits that the prayer in the writ petition relates to the allotment of 2007 as modified by the order of the DC dated 18th April/19th April, 2007. However, the order dated 12th February, 2008, which is a subsequent order of allotment has not been challenged. Therefore, the writ petition is not maintainable considering the nature of the prayers made.
Having heard the parties and considering the materials on record, this Court finds that the law on the point has been settled by the Hon'ble Division Bench in 2007 (1) CHN 514 (supra), which is a law subsequent to 2004 (2) CHN 606 (supra). Before dealing with the ceiling limit of allocation qua the storage points and the agreement entered into between the parties, this Court is required to notice the ratio decidendi of the judgment reported in 2004 (2) CHN 606. At Paragraph 21 the Hon'ble Division Bench was pleased to, inter alia, hold as follows:-
"21. Now comes the question of opportunity of being heard. By my order dated March 21, 2002 I disposed of the writ petition of the respondent No. 1 by directing the Director of Consumer Goods to convene a meeting of all the concerned parties. Accordingly, a meeting was convened. The respondent No. 1 was present at the meeting and after mutual discussion it was decided that the upper limit of supply would be 250 KL. per agent and at the same time pro rata distribution should be made. At that point of time the respondent No. 1 did not raise the issue of Barisha as they were satisfied with the supplies being made by the oil company. No party challenged the decision taken at the said meeting held on May 2, 2002. Hence, parties to the said meeting were bound to adhere to the resolutions taken therein. In Clause 1 of the said minutes it was categorically resolved that in any case the quota of agent would not exceed 250 KL. The respondent No. 1 was an authorized agent for Behala. They were to get supply under the agreement and the agreement only. Since Barisha was a part of Behala whatever supplies are made at Barisha would flow from the quota allotted to the respondent No. 1 in respect of Behala so supplies made at Behala and Barisha could not exceed in aggregate 250 KL. The oil company while reviewing their allotments in terms of the said resolution taken at a joint meeting found out their mistake and rectified the said mistake to implement the true spirit of the resolution taken in the said meeting held on May 2, 2002 wherein the respondent No. 1 was a party. Hence, in my view, the principles laid down in the case of Mahabir Auto (supra) would not in any way help the respondent No. 1 in the peculiar facts and circumstances of this case as discussed hereinbefore. I am constrained to say that the learned Judge did not approach the problem in right direction while applying the ratio laid down in the case Mahabir Auto (supra)."
Therefore, the Hon'ble Division Bench held that since supply was effected by virtue of a single agreement entered into by and between the parties and, the agreement was in respect of supply at Behala without mentioning the supply point of the agent at Barisha, which was also within Behala jurisdiction, the agent was not entitled to any supply at Barisha de hors the terms of the agreement.
This Court notices that the judgment in 2004 (2) CHN 606 (supra) stands on its peculiar facts. This Court also notices that the judgment in 2004 (2) CHN 606 (supra) was not brought to the notice of the Hon'ble Division Bench in 2007 (1) CHN 514 (supra).
However, this Court further notices that the subsequent judgment reported in 2007 (1) CHN 514 (supra) deals with the policy framework applicable to an agent supplying SKO through the PDS of a State, recognising the primacy of the licencing procedure implemented by the State under the 1968 Control Order (as amended up to date). The Hon'ble Division Bench was pleased to, inter alia, in 2007 (1) CHN 514 (supra) lay down the law with regard to the allocation of SKO through agents as already discussed above in this judgment.
To the mind of this Court the judgment reported in 2004 (2) CHN 606 deals with the particular facts of that case. The Hon'ble Division Bench in 2004 (2) CHN 606 arrived at the conclusion that in respect of a particular jurisdictional area covered under the agreement, viz. Behala, the supply will be covered by the terms of the agreement and not beyond.
However, the facts of the present case lie on a different footing. The two supply points of the petitioner no.1 relate to two separate storage points in two different States. Having regard to the law laid down in 2007 (1) CHN 514, each of the States will be governed by its own Control Order. In the State of West Bengal and, the present writ petition relates to the reduction in supply in respect of the Purulia storage point of the petitioner no.1, such will be regulated by the 1968 Control Order (as amended up to date). The 1968 Control Order mandates that the SKO be allocated in terms of the ration card holders being handled by the agent through its dealers/retailers.
The judgment of the Hon'ble Division Bench in 2007 (1) CHN 514 makes the policy of distribution dated 10th January, 1990 of the oil company nugatory. The absence of any role of the oil company in the distribution process has been also made clear through the stand taken by Ld. Counsel for IOCL by recognising the judgment of the Hon'ble Division Bench reported in 2007 (1) CHN 514 and, calling upon the State-respondents to justify the reduction.
In connection with the above noted discussion this Court is required to rely on the law surrounding the principle of precedence noticed by the Hon'ble Apex Court in 2006 (6) SCC 366 in the matter of Uttaranchal Road Transport Corporation & Ors. vs. Mansaram Nainwal at Paragraph 13, wherein it was held as follows:-
"13. The High Court unfortunately did not discuss the factual aspects and by merely placing reliance on earlier decision of the Court held that reinstatement was mandated. Reliance on the decision without looking into the factual background of the case before it is clearly impermissible. A decision is a precedent on its own facts. Each case presents its own features. It is not everything said by a Judge while giving judgment that constitutes a precedent. The only thing in a Judge's decision binding a party is the principle upon which the case is decided and for this reason it is important to analyse a decision and isolate from it the ratio decidendi. According to the well-settled theory of precedents, every decision contains three basic postulates (i) findings of material facts, direct and inferential. An inferential finding of facts is the inference which the Judge draws from the direct, or perceptible facts; (ii) statements of the principles of law applicable to the legal problems disclosed by the facts; and (iii) judgment based on the combined effect of the above. A decision is an authority for what it actually decides. What is of the essence in a decision is its ratio and not every observation found therein nor what logically flows from the various observations made in the judgment. The enunciation of the reason or principle on which a question before a Court has been decided is alone binding as a precedent. (See: State of Orissa v. Sudhansu Sekhar Misra and Ors. (AIR 1968 SC647) and Union of India and Ors. v. Dhanwanti Devi and Ors. (1996 (6) SCC 44). A case is a precedent and binding for what it explicitly decides and no more. The words used by Judges in their judgments are not to be read as if they are words in an Act of Parliament. In Quinn v. Leathem (1901) AC 495 (H.L.), Earl of Halsbury LC observed that every judgment must be read as applicable to the particular facts proved or assumed to be proved, since the generality of the expressions which are found there are not intended to be exposition of the whole law but governed and qualified by the particular facts of the case in which such expressions are found and a case is only an authority for what it actually decides."
This Court is also required to notice that the interim order of the Hon'ble Single Bench dated 5th July, 2007 has recognised all aspects of the matter and directed that the monthly allocation of SKO in respect of the petitioner no.1 for the District of Purulia as well as the added respondent shall be acted upon after taking notice of the total monthly allotment in respect of the District of Purulia as well as the number of dealers tagged to the agents through the dealers/retailers, including the interest of the consumers. This Court again notices that the monthly allotment of SKO in respect of the distribution point of the petitioner in the State of Jharkhand at Chas has been treated as a separate class by the Hon'ble Single Bench vide its order dated 5th July, 2007.
Upon consideration of the above noted facts and the relevant law applicable, this Court is satisfied that the principle recognised by the Hon'ble Single Bench vide the interim order dated 5th July, 2007 is good law. This Court is also satisfied that the interim order dated 5th July, 2007 has been acted upon by the DM, Purulia vide his order dated 12th February, 2008 and by the DCG vide his order dated 13th February, 2008 (supra). Such position of supply as laid down by the above noted two orders dated 12th and 13th February, 2008 are continuing. Having recognised the above noted facts and law this Court is satisfied that the Memo dated 18th/19th April, 2007 issued by the DC read with Memo No. CG/K.Oil/A6T/Puru/10/66/72/3 dated 12th February, 2008 of the DCG are not in accordance with law and, therefore set aside.
This Court further notices that the arguments advanced on behalf of the private respondent no.9 are based only on technicalities. In respect of the arguments advanced by the State-respondents, this Court also notices that such arguments do not recognise the law on the subject laid down in 2007 (1) CHN 514 (supra).
Before parting with this case this Court is required to notice that the validity of the arguments raised by Sri Bandyopadhyay to the effect that the procedure is now active for entering into two separate agreements qua IOCL in respect of the two storage points in two States, has been already taken notice of by this Court in WP 11364(W) of 2014 in Master Engineering Works & Anr. vs. Union of India & Ors.. Therefore, the writ petitioners are entitled to supplies in terms of the order dated 5th July, 2007 following the procedure laid down in the State Control Order, subject to its amendments, as recognised in the judgment reported in 2007 (1) CHN 514.
WP 12111(W) of 2007 stands accordingly allowed.
There will be, however, no order as to costs.
Urgent certified photocopies of this judgement, if applied for, be given to the learned advocates for the parties upon compliance of all formalities.
(Subrata Talukdar, J.)